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Thank you Gary, I exited oil completely, just in case. In couple of days it become more clear… but will add NG on weakness.
Good morning,
Today is a Friday, a concluding day, and a pay day.
SM may have a solid gain today as all retirement accounts must pay a premium.
Yesterday, bounce was a very picayune one.
Forex is about flat but bond yields are down.
There is an edge for gold to survive today to further drop.
Will it be a good day today or not, this is the key question.
Add to that that premarket volume is nothing exciting.
Goild = Honmag?
To wet the appetite got 500 JNUG shares at $18.46.
It does not matter which way it goes.
The point is one gets psychologically engaged into the game.
For whatever reason gold has a tendency to bottom on or close to the full moon. Those trying to pick the bottom again yesterday may still be a week too early.
And the intermediate bottom probably won’t come until the yen completes its ICL. That isn’t due until October or November.
You got on a chart on that one? I would like to see phases of full moon put on a chart and golds reaction. I find it hard to believe that gravitation forces have anything to do with the price of commodities – but certainly nothing is impossible.
Clearly gravity has nothing to do with the gold cycle. Probably just by coincidence gold bottomed several times along with the full moon and traders started to notice. That created a self fulfilling loop and now traders have become conditioned to wait until the full moon before they start buying.
that was my operating theory for years…I’m now a full mystic convert 🙂 ‘signs and seasons’ is more than poetry imo.
it’s called superstition
much more than gravity at work there, electromagnetic and likely other forces we are not even aware of yet. Chris Carolyn has done a lot of work in this area, looking at tidal forces which are the combined result of the sun’s and the moon’s pull on the earth. http://spiralcalendar.com/
Gary — Weren’t you trying to call the bottom yesterday when you mentioned the Yen would bounce off the intermediate trend line??
He also tried to call the bottom a few days before with his GDX entry, but ended up closing the day after, in the red iI might add. Regardless of position size.. the point was he was chastising bottom callers when he was one of them 🙂
I’m chastising people for trying to call a top in the stock market. For heavens sake quit doing this. How much money must people lose before they listen? The single most efficient strategy ever developed for losing money is to try to short a bubble.
Gold is in the timing band for a DCL. At this point though I’m pretty much convinced that the intermediate cycle is in decline so a better strategy would be to sell any rally rather than try to go long a counter trend move.
Once a bubble pops then it’s shortable.
Bitcoin may be shortable.
At the recent top price was stretched 300% above the 200 DMA. Yet still people expect it to recover and keep rocketing higher.
Folks at the very least bitcoin is done for many months as it will take a long time for the moving averages to catch up to price. Or if the bubble has popped like I believe then we are seeing the counter trend bounce that sucks investors in before the second leg down begins. This is the recognition point where everyone finally realizes that greed caused them to stay too long and now all their profits are evaporating.
Gary — Any chance you could stop being so evasive? We’re not talking about the SM. We’re talking about precious metals. If a better strategy is to go short every and any bounce then why would YOU *buy Miners and sell the very next day?
*according to Nada
There is no way to short Bitcoin. You either get out on time or you get crushed in the fall. There is no safety net and no way to profit on a decline. Like any good speculative bubble its 100% risk if you make a mistake, then lights out and that’s all she wrote.
Nada — Notice how Gary didn’t directly address the question. He does that every now and then.. kinda like a Politician 🙂
My recommendation is that subs only use a maximum of 20% of their portfolio on metal trades if they are even inclined to trade metals. As I’ve pointed out time and time again the metals and energy are stuck in trading ranges and difficult to trade. I’ve continuously urged people to focus on stocks right now. That market is trending and I think it’s about to enter the vertical phase of a bubble. That kind of market is much easier to make money.
I’m comfortable with subs focusing 100% of their portfolio in stocks if they are so inclined.
The first tag of the trend line in the yen was a potential spot for gold to complete a DCL. Even so I was not confident enough to risk hardly any of our profits on the trade. I only entered a 10% position for the metal portfolio. So assuming one was willing to allocate 20% of his TOTAL portfolio towards metals a 10% position would only amount to risking 2% of his total portfolio on that particular trade and since GDX could never go to 0 we were actually only risking maybe .1 or .2% of ones total portfolio.
Now you see why I say that percentages are important and why everyone must include them when they place challenge trades.
I’m a big fan of your strategy Gary (always have been) but why give others a hard time for a picking bottom in precious metals and trying to play the BOUNCE UP if you yourself are willing to wager a bet?! That’s the part I don’t get.
Swing low is in place, but all bounces are being sold in gold. With today being last day of month, I assume for window dressing, fund managers would want out of gold – as it has been a poor month. So may see increased selling.
Closed my Jnug for a 1k profit, enough for lunch at Maxim’s.
The calls for a top and 10-20% correction in stocks were certainly a bit premature 🙂
I said this would happen. Traders and analysts will try to call the top all the way up and in the process most will miss the vertical phase just like most everyone missed the baby bull.
yes, but when the top finally arrives, all those top callers will be able to say, “I called the top!!” (even though they were wrong all the way up 😉
Unfortunately one doesn’t get a second chance at a baby bull or a vertical phase.
So many traders and analysts never bother to look at the weekly charts.
Look at the weekly charts of:
SPX
DOW
Nasdaq
Semis
Transports
Small caps
European indexes
Energy stocks
And the dollar
Now compare that to the weekly charts of gold and GDX….
vix close to early August lows.
Remember how long the ROBO ratio can stay at extreme levels during the final 6-8 months of a bull market.
If not you should watch this again.
ERX is once again over extended and due for a correction.
Picked some shares of ERY @10.95
Christian, you and Bigdaddy are the two most honest characters here about your trades. You have my respect. It seems that the guys offering their technical BS are forever bragging about the calls that are right while ignoring those that are wrong.
Good luck with ERY. I think you will do okay with it.
There are about 40 traders in the challenge all of them making real time trades along with percentages. That’s about as honest as one can get.
Thx JJ — I try and keep it real as best as I can but perhaps Gary’s right.. perhaps I should include percentages, especially if I’m gonna take over the family business 🙂
Kind of a flat day.
But there has been some volatility and I am done for the day, for the week, and for the month.
A consistent trading ANT gets to be well paid for diligent work, $4156 for the week, and ~$20K
for the month. The ANT does not take too much risk and sleeps well.
Have a nice weekend!!!
M +$1324
T +$900
W +$731
T +$519
F +$678
GOILD — Unless you post a SCREEN SHOT of your trades demonstrating that you are indeed pulling in that kinda of money EVERYDAY OF EVERY WEEK, then I call baloney..!
The spreads are too wide on the leveraged funds to make that many trades successfully. So either Goild is pulling our leg or he’s a hedge fund using a high speed computer to scalp those kind of quick trades.
Even so he appears to have a higher win percentage than anyone in history even GS. So I have my doubts.
I love how he talks about himself as the ant. The ego on this one! Anyway, you will not see a screenshot, Goild just likes to talk a bunch of BS.
Yup, offers no insight or input. Just wants to brag about fantasy gains. This isn’t a day-trading place anyway. Just useless spam that I get to work my finger muscles on scrolling by…
O geez, Goild, will you stop already! The more you brag about those never ending daily wins, the less believable you become.
Anyone who wants to go long the miners is getting plenty of opportunity to do so. No V bottom for GDX or GDXJ. Maybe that is to come yet,
I probably won’t try another long trade as I’m now convinced gold is in the declining phase of its intermediate cycle, but if I did I think I would try waiting till the end of next week and see if we get another full moon bottom.
Harvest Moon comes on October 5th this year (Thursday). Sounds like a good fit for the gold bottom to have formed before the next bounce. It’s taking forever but looks great to me still.
Sort of reminds of how the last cycle was. It was slow coming out of the ICL and had everyone thinking the ICL was still in front. Yes very boring at the moment. It needs some sort of catalyst to get over the hump. I guess the safe bet would be to long after it breaks out of the downtrend channel;
https://gyazo.com/706df2ffdda102ac6ce99bafd84088cf
Yes. Given its a Friday I suspect not many will gamble thinking what gold might do by Monday morning. Any political, economic or financial disturbance in Europe over the weekend could result in the euro taking a dip and gold breaking dowwn again. On the other hand, any bad news in the US or another NK missile will send dollars down and gold up. I think the chart is telling us gold will rise though and am hunting for a JNUG bottom right now. Maybe 18 will be enough as its getting late in the day. I could be wrong about this of course. But I am putting my money where my mouth is.
Gary, I’m thinking you got lucky with ERX. If you had a big chunk of your own real money into it, would you have allowed that massive draw down to occur? Triple leveraged funds are not buy and hold products.
Sure I would have. How many times must I say this?
The rallies out of yearly cycle lows are the most powerful rally of the year.
Unless energy was entering a new bear market (very unlikely) there was never really much danger of the trade producing a loss unless we just got impatient and didn’t allow it to work.
Gary —– We’ve got Huston, a lot of Florida, and the whole island of Puerto Rico to rebuild—-plus we’re in wars all over the place. That’s going to take up lots and lots of energy…..not to mention the US has to have learned by now there is simply no way in hell to bring Russia and Iran down by keeping oil prices low. Oh….and one more thing…..the ARAMCO IPO is coming up soon and JP Morgan and Merrill are the underwriters.
Oil is going up for sure
September has been a great month for the stock market and now they say the economy is looking good. i am starting to doubt the wisdom of being in GDX.
I’ve given you all kinds of free information that would allow you to develop a winning strategy.
I’m not sure why you bounce from one trader to the next looking for advice. No one has a crystal ball. From time to time someone will get several calls in a row correct. That doesn’t mean he or she knows something that no one else knows. If just means they got on a streak.
Chasing streaks is probably the stupidest thing traders can do. By the time the streak becomes clear it’s time for the guru to hit a cold spell.
I think you are finding that out.
Pick a strategy and stick with it. Accept that every strategy will fail from time to time. But if you stick with it and it has a positive expectancy you will make money over time. (Shorting a bubble phase does not have a positive expectancy).
Gary, were you addressing me? I have one investment and that is GDX. I will buy more if it drops off but won’t sell at a loss. Isn’t that what you said works as it did for you and ERX? And, where do you get the idea I am bouncing from one trader to the next?
I think Gary was talking in general terms and not addressing you specifically Lena. I don’t see anything wrong with buying and holding GDX or any other ETF that has been beaten down. I am doing the same with GDX.
Bigdaddy has been awful quiet. I see FB has come back fast and that is probably making him sick.
BD is probably pouting from the tongue lashing he got from Gary for being nasty towards pedestrian. LOL!
I think we can all agree the blog has become a much more friendly place.
That’s true Gary but it was a pretty “friendly” place when Pedestrian disappeared for a few months. Your attack dog has been the problem that others reacted to, not the other way around.
Not trying to start anything but agree with JJ on this one.
People would razz each other occasionally but it would never go too far and turn into something nasty.
BD implied he was leaving the blog.
Ped can now breathe easy… LOL
Gold bugs: YIN Yintec Investment Holdings
http://stockcharts.com/h-sc/ui?s=YIN&p=D&b=5&g=0&id=p13151119057
Not a miner but a new electronic mobile platforms for trading PM’s and commidities on 3 Chinese exchanges. Wonder if the Chinese have any interest in trading gold, silver, oil and platinum?
Like the risk reward on this chart. Bought a lot. No miners but like this one.
The semi-conductors are ramping up again. Their performance has been absolutely amazing but makes little sense from a value perspective. PE ratios over 200 have become the norm for momentum stocks.
I guess what is really amazing is what trillions of dollars of printed money can do when it needs a place to park.
I think it will eventually land in the metals as well, but the stock bubble needs to finish and pop first.
Silver is taking a hit today. I want to add to my SLV position but won’t do so unless we get a deeper sell off. Otherwise I will stand pat with what I have. Gary, do you see a big sell off coming for sliver and gold?
I think people started treating Ped better when he had bullish comments about gold, lol.
I’m bullish today. I have a chart theory I am working through which I have discussed at length. Probably too much actually so I’m keeping it short today. I am a buyer though and believe gold and miners have energy to spare to run higher once more.
You still thinking new highs before the ICL?
Looking for a bounce here and then play it by ear after that.
MINERS — my spidey sense is telling me ONE MORE LOW before the bounce up!
And there she goes 🙂
Yup. Nothing major yet though. I did not buy in the end. Price never got above the 50 minute so I was put off. Technicals mostly lined up but we never got the end of day vote of confidence. Not enough volume or buyers and that nixed it. Maybe Monday.
if you are willing to buy at the end of the day and hold over the weekend then you are not day trading.
This is why I started the challenge to get rid of comments like this. Earlier in the day you claimed you were buying and putting your money where your mouth was then by the end of the day this had changed and apparently your conditions had not been met. On the other hand I suspect if the miners had rallied into the clothes you would have bought.
Get into the challenge and put your neck on the line with the rest of us.
You are right. It does look that way. My apologies but nobody asked if I bought along the way and so I never followed up with commentary. But I did say I was looking for a bounce and I did not get it. Since its such an irritation for you this will be my last comment on what I am doing (or not doing) from here on out. We can keep it general from now on. But for the record I have never been one of the people making claims about big wins since I don’t do any of this for the money.
Thoughts on the dollar? Potential swing high and a close below the 10ema. Gold seems to care more about the yields.
Nothing out of the ordinary — The dollar is bouncing off the 50DMA (as it should) in preparation for a break through Resistance @94 which also coincides with the .236 FiB. That should push Precious Metals further down into the rabbit hole 🙂
https://www.tradingview.com/x/U1PL5ZH8/
Grabbed some JNUG for 17.85 AH after seeing GDXJ on the BOW list. Hopefully flip it Monday or Tuesday for a quick 5% or so.
20m? thats nothing in regards to BOW. However, we have not had that final print yet so it may be much higher.
Now the 20m fell off. Lets wait until 4pm eastern to see the final print.
Yep, it fell off. I’m going to hold it as it isn’t a large position.
I see XLE moved up to the top of the list though.
Yeah that stop run was very suspicious into close. I think the GDX fell off because there is going to be a bigger print.
I have a few doubts now too. Waited until the very last minutes but JNUG did not cooperate and broke more than a penny below the support line I was following which is a no-no. Not usually a great idea to buy late Friday in any case but confidence was just not there in the end. Might be this second world war movie I have been watching that put me off. Kind of a rare flick but really disturbing.
Which movie ?
Not sure. It’s not listed for some reason. I will have to wait until the end to see what it is. Probably made mid 60’s though.
STOP RUN! They just took out the low and now potentially moving it back above the .5 fib for the close.
Today, spot gold is down 0.54% and GLD is down 0.52%. Gold ETFs are based on spot gold and not futures contracts. The most heavily traded COMEX futures month is December and it is down less at 0.30%.
Today’s spot low of 1275.50 is below yesterday’s low of 1277.50.
The COT for Gold and Silver shows the Commercials continue to reduce their short positions.
https://snalaska.com/cot/current/charts/GC.png
Troy, I see the commercials reducing their SHORT positions while the Specs are reducing their LONG positions. That is not unusual as gold declines.
For those that may not be aware : Spot gold (XAUUSD) trades 24 hours every day on the FOREX whereas the COMEX futures finish trading at 5pm on Friday.
Those who use futures graphs ( with the accompanying roll over distortions) for studies are not doing themselves any favors.
No, spot gold is not traded 24 hours. It closes for 1 hr just like futures.
My mistake. You are right Nada. The Forex opens at midnight and trades until 11pm (Eastern time) Monday to Friday.
What is your understanding of the hours for gold trading on the COMEX?
That is an opinion.
Ha! You got in front of my comment Nada. I was responding to JJ’s “no favour” remark.
Hell I just re-read his statement. He also said its traded everyday. Wrong again. Same schedule as gold futures.
They give out points for overconfidence though.
Don’t they? 🙂
My opinion? You don’t think contango issues are a problem for those using continuous futures charts for their studies?
Remember recently when you got all excited about wheat jumping over night and then was puzzled by the ETF WEAT being down? The “jump” was just a roll over from one contract to the next and there is huge contango with wheat (and other grains) and you missed it.
Gold futures have some contango also although to a much lesser degree.
Gary,
“I think we can all agree the blog has become a much more friendly place.”
I agree 100%. Not just the obnoxious direct rudeness, which I actually paged down thru beginning months ago, but it was impossible to avoid the snide remarks directed at me personally, having zero to do with markets.
What was the antagonist’s name in Lord of the Flies? Ralph? Can’t remember, but that was the one who needed to be brought to kindness, if possible.
Don’t let it bother you Zkot. I read all your posts. The old arguments are over the dam as far as I care.
No offence Zkotpen but if you could please stop playing the victim card.. A lot of your ramblings in the past have had nothing to do with the Markets and sometimes made no sense at all.
Even Gary has made a few observations in that regard, so you might want to take some responsibility in this and change your tune.
Like the great bill burr once said: Not every Ass kickin just falls out of the sky for no reason!
Pedestrian,
Just caught a WWII pic produced during a moment of uncertainty (not post facto)…: Desperate Journey, 1942.
GDX, gold, USDJPY in a tight range means better to watch Errol Flynn on screen than charts, and get ready for next week…
Who knows. Maybe this is it. I was captivated by it though. The storyline is one of betrayal, petty revenge, desperation, shortages, human cruelty to their fellow man and how the most rotten dregs of society rose up to positions of power and became inhumanely cruel. What bothered me most about this movie was I know from history it was all true. Friends turned to enemies, your family turned you in for any meager benefits they could get and almost nobody could be trusted anymore. We might hope such days never return but if we really get an economic collapse and large wars we should keep in mind that human nature rarely changes and all the same ugliness will return.
LOL, I plotted full moons and gold.
https://gyazo.com/46263c11d00f9c101b195daed41da377
LMAO! Brilliant 🙂
Can you plot ahead with our current BULL trajectory?
It is strange how so many cycle bottoms occur on or very close to a full moon.
Indeed. I was waiting for you to show me the chart, but I had to take matters into my own hands 🙂
Great work Nada. I see it catches a few tops too so not something we can make a rule out of.
The rule would be that if price is moving down into a cycle low it might pay to wait until we get to or almost to a full moon before trying to pick the bottom.
Obviously some full moons have no meaning as they occur in the middle of a cycle. But when gold is dropping into a cycle low they have tended to keep dropping until the full moon appears.
Again I’d say it’s just coincidence, but has happened enough times that now traders wait for the full moon before they buy.
Yep exactly what Gary said, use it in a downtrend. Very interesting. Another tool to add to your repertoire
Gary
Can you post a chart of cycles and full moons. I can’t visualize what you’re talking about.
Obviously, financial astrology is bogus but if it gives enough traders reason to push a button at the same time it’s worth looking at.
If you scroll down a couple of comments you will find a link where Nada already did that.
Looks like there is more room to the downside for metals & GDX; upside for USDJPY in this daily cycle…
Go to indicators and search for Moon Phases. POS plugin doesn’t show future events 😛 . Looks like there is something to the ol’ moons and goochers.
I’ll try and pull up a Calendar and manually plot them into a chart on Tradingview over the weekend, if I have time to kill 🙂
I added new moons to the chart.
https://gyazo.com/e82e4723f60a4e4d7c85efceb9830d8c
Some etfs are nudging previous resistance and some etfs are really stretched out. Some kind of pull back in October? COP could pullback to 200 ma on daily.
Well I’m done here for today. Have a nice weekend. See you Monday.
Goild,
I am working thru the test at the end of ‘Trading in the Zone’. As the author states, “It will take as long as it takes.”
During testing, I have forced myself to limit risk to $10 on any one trade. As you know, that’s not position size, rather the amount I am willing to be in the red, including commissions, before bailing out. One could say, may as well do the test with a Demo account, and I won’t argue. For me, just micro trades until testing is complete, risking tiny amounts of money to make 3x tiny gains — the setup needs to exceed the risk:reward criteria. That’s how I’m building emotional capital against the losing trades. That’s my plan to cultivate consistency.
Most recent losing trade was ten bucks, and it took me about an hour to recover — a losing trade still stings regardless of size, and I need to change from feeling sting to “each loss puts me one step closer to a win”. Hence the small trade size, but not Demo account. After all, in my losing trade, I was correct in my assessment, just messed up the timing. Had I removed the sting of loss more quickly — even immediately, or perhaps not even felt it — I’d have noticed the setup for the opposite trade develop shortly after I stopped out, and taken it. And that’s the point of the test: To get all of the bugs out of my mental software.
As for the two problems you mention, there is one cause underlying both of them: You have not cultivated and internalized the belief in uncertainty.
So long as you don’t define your risk before entering a trade, you will continue to lose sleep by holding over night. Of course, the other alternative is to do it informally or intuitively, and just keep on day trading. If you’re producing income that way, may as well stick with it… unless there’s some other reason to adjust your time frame.
As previously stated, I’m already modernizing cycle theory in my work. Just as calculus brought physics to a whole new level… from medieval to modern… by examining the infinitessimally small and infinitely large, so, too, one can see the fractal nature of cycles, down to very small and up to very large degrees, both of which become limited by quality of the data and, I believe, human and machine factors.
For testing, I’ve chosen USDJPY as the market. And time frame is the cycle just below what is commonly called “half cycle”. That cycle just below “half cycle” has a timing band of 2-4 days. I’ve learned that to take such a trade without being glued to the computer means having clearly defined risk and profit targets. My setups occur, and I am either on-point in recognizing them, or not. No time to dilly dally around worrying about “being right”. And I need my beauty sleep 🙂 Just take the trade, make a small loss if I’m wrong, make a profit at least 3x that amount if I’m right. Either way, move on to the next trade. Compile a small history of doing that, then — and only then — move on to bigger sized trades, so long as my record permits it.
How was that book by the way ZKOT? Isn’t the writer more of a motivational type than an actual trader?
I have stopped looking for answers in other peoples material anymore. There are no gurus and no easy systems. People whose work I used to look up to have disappointed when I discovered that they had only marginally more insight than the next guy. And luck combined with good timing plays a bigger role that I expected.
What I have discovered instead is that trading is not difficult as long as you are prepared to reverse yourself in an instant when you discover you went down the wrong path. But that is not teachable since the process happens in real time and is very fluid so its not easy to quantify for anyone else.
Anyway, I will look at an online copy of the book if you think its worth a recommendation.
Pedestrian,
Populism always leads to conflict and it seems the world is racing toward populism.
As with gold & currencies, the Swiss have the best approach, but they’re super tight lipped about it. You’d need to befriend someone from Ticino to eventually get to that understanding!
Really? Then I might wish for more popularity! LOL
I have been refining some technical ideas lately but talking about them out loud does not often lead to the reaction I expected. This site really cracks me up because its often a collision between chicken feathers and science. A place where reasoning melds easily with bullshit and bluster.
Anyway, I have three trade forecasts running at once as a test of a new idea. I was calling for gold to bottom at 1280 followed by a move that would take us all the way back up to the highs of 2016 and eventually hit the 1400 region. The third part of the forecast then states gold collapses by almost 300 dollars into the low 1100’s.
So far I hit my first target zone which I thought was pretty good since I made it when gold was 40 dollars higher. Pretty pleased about that actually. But I don’t want to get overconfident and that showed when I did not make the trade by days end yesterday. We will indeed bounce from here as I initially expected though and that part became clearer after hours when I saw that stop-run spike low.
Unfortunately that news was not crystal clear even up to the last minutes of the day and I chickened out when my support line broke thinking I may have made an error. No harm in waiting over the weekend for that bull entry though and that’s what I will do.
Anyway, next terminus is the 1400 region. We will get there in the usual way with two steps forward and one step back until a shortable top comes into play. If this second prediction also works out then I have to warn you the third is almost assured.
And that calls for a multi-month grind back down the chart that will really be discouraging if you were a bull. So this isn’t the usual charting I am testing out here. Its actually more like chess since I called three moves in advance based on ideas I am working on and if this proves itself I will consider it a tremendous breakthrough.
So all we can do is watch and wait now.
I will be kicking some serious ass if I turn out to be right though.
Zkot,
Thanks for sharing. I hope you find your way to make bigger bucks.
The books tell make a 3X profit where X is the potential loss.
Perhaps in modern time the 3X thing is misleading.
Looks like sound advice but I do not make money that way.
I have no patience to wait for the 3X setup.
Let us what next week brings, I will be October.
I got 333 JNUG shares at $17.89 to carry over the weekend.
I still have 1000 GDX and will wait till the miners go to the Moon.
The weeks ago traders here were lamenting to have miss the bull leg.
Now is different. But it is the time to play the pyramiding.
Trying to catch the bottom can lead to miss the rally.
So I will accumulate more and more shares.
To do the same trade I did last December with NUGT.
So, yesterday both gold and silver posted bullish “outside” days and platinum posted an outside month.
That’s how I am reading the last days action anyway. And the stop-run that sent gold down below the 1280 level was just enough to scare some of the fish out of the water and allow other buyers to pick up stock at the lowest prices of the day during after-hours.
For example, JNUG which I was watching dipped down below 17.90 as gold spiked lower. It’s gold that acts as the lever to move gold mining stock. So a party interested in getting the best possible entry prices on gold mining ETF’s needs to sell gold hard at a key moment then be ready with a buy order at the preferred price on say GDX or GDXJ as examples.
At the same time, they have indirectly forced prior buyers to sell unexpectedly if those others had stop losses in place to guard against deeper downside action. Those sellers are not the real losers though. It’s actually the guys who had been holding since the top and saying to themselves they would tolerate gold falling until 1280 but below that level they wanted the hell out.
Those guys got screwed the most. Because now they are out of the trade altogether near the lowest-lows of the day. But its their automated selling that creates the conditions of cascade selling for gold and mining stock to fall. If a large player wants to move price down he need only trigger the sell-stops and those sales actually do the hard work of pushing prices down for him.
That’s how leverage works in this case. If you want to move a billion in the market you don’t need a billion to do it. All you need to know is where stops are congregating and if you can get the ball rolling with a fraction of the dollars you were looking to move then the animal takes on a life of its own and down goes price as the stops trigger one after another.
And then price drops right into your lap where your low bids were sitting all prepared ahead of time.
What we see on the chart is a spike low (candle) on the hourly chart (in this case).
https://finviz.com/futures_charts.ashx?t=GC&p=h1
That thing is most likely a buy signal for next week and odds are great prices will be above that low print when markets open meaning only the bigger players who dominate after-hours are in at those low levels. Everyone else will have to settle for something less.
We likely have our reversal turn on gold too so the bulls who are still holding miners can breathe easy. This was about the 50% Fib level. I am partially in already but did not make the second buy because I lost confidence in the final minutes of the day. It happens. So I will probably not get another chance at JNUG for 17.95 when Monday comes but I will be a buyer at a more certain price since the pop will give confirmation the trade was in fact the correct one.
Anyway, this is not a new thing. Just look at the gold chart (or any other chart for that matter) and you can see that tops and bottoms are littered with candles and spike lows at peaks and valleys showing you visually the point where serious money entered, ran down the stops of the retail crowd (or caused buying at the very tops) and then picked off the best prices for themselves before the trend reversed again.
Happy trading next week bulls. But don’t forget to bail out sometime soon after we near golds 2016 highs. My program calls for a long fall once that high is achieved (possibly as high as 1400+ on gold) and unless you have deep pockets and don’t mind losses going into 2018 you should seriously consider some profit taking at the next top.
Not so sure Ped. 1275-1260 on spot may be a possibility. A bounce to 1330-1345 and then into ICL. Honestly, the bull is in question – how can gold be in a bull market by making lower yearly highs? Year is not over yet, but at the moment I don’t see a higher high. I hope you are correct and looking forward to how this plays out.
When we see COT positioning equal to what is was back in the middle of 2016 when gold hit its top we will know the end is near. The market is going to get the maximum number of bulls onto the long side again before the most serious (and final leg down) in gold gets underway. There has to be meat on them bones or gold won’t decline to where it should. And the way to do that is to have gold exceed the 2016 peak if only by a few bucks which will convince the bugs the bad times have finally ended. We are not there yet. What we have seen so far is only a corrective decline which sets up gold for another run higher before its yearly top gets posted and the conditions have been created for a fall through much of 2018.
Gold is in a basing pattern and probably will be until the bubble phase in stocks is over.
Saying gold in a basing pattern is a far cry from your prior insistance it
I’ve been saying this for months and months. Commodities are going to remain stuck in basing patterns until the stock market finishes it’s bubble phase.
Do any of you ever bother to pull up a multi-year chart and take a big picture look at what is actually going on.
Gary has finally come around to believe in the full moon correlation, good as any other.
Gold found its support trend-line on Friday at 1278.
The past 5 turns also tagged or came close to this trend-line on a Friday and then turned up the following week on the full moon.
The July7-10 turn broke the support trend-line to tag the bottom of the channel for the retest of the December low but followed the same pattern , making that 6 in all.
please post a chart, thanks
I’ve posted it several times in the past.
Gold as been in an up-trend since December, that low which actually was a spring has been retested at a higher low in July.
Pedestrian,
I recommend the audio version of Trading in the Zone.
This is about getting one’s mental approach correct, so there’s zero fundamental or technical analysis — the author assumes you’ve got your own reasonably sound technical approach.
One of the key things to get into the mind is the absolute belief in uncertainty, and not just lip service to it. To do so forces you to calculate risk and reward before entering a trade. Sounds easy, but that has taken me more than a month to hammer into my thick head — after dealing with other flaws.
Then, once I get uncertainty as a truth ingrained, next up is getting past emotional reactions. I went back and checked Friday’s trade again — actually, the correct trade was in the same direction of the original trade I got stopped out of. Some people might say I’m setting myself up for whipsaw, but that’s simply not the case. When I got stopped out, I lost ten bucks, which I put on the line to make thirty. Getting stopped out was necessary because, as USDJPY continued to decline, once it passed my first signal, it was uncertain when it would turn. Just so happened to turn only a little bit lower, but I had no way of knowing that at the time & cannot allow myself to presume to know it.
As it turned out, it would have been worth even more than 3x the amount lost. But I was too busy crying in my coffee and missed the proper buy signal for USDJPY. So at this juncture, it’s about getting past any emotional reaction – positive after a win, or negative after a loss, and just moving on to the next trade. Used to take me a week. Then a couple of days. Friday, it took less than an hour. Just like a basketball player takes a shot and makes it, then takes another shot and misses, and another, and another, and another… making some, missing others, but either way, needing to recover immediately and move on to the next setup or the next jump shot.
I’ve been working on this in 4 different paths, only one of which is trading and markets. Another has been the wanderings. Another is Buddhism. In any event, it’s all about removing mental obstacles, removing negative thought patterns, removing harmful or limiting beliefs. Taking out the mental garbage, and instilling more healthy, successful thought patterns in its place.
Otherwise, watched another WWII film… from 1944… Errol Flynn again: Uncertain Glory. Flynn’s always been one of my favorite actors, beginning with Robin Hood. Seems I just put him mostly on a back burner for a few decades.
Goild,
Yours is a tricky case. Have you been keeping records of your trades?
If so, what is your historical risk:reward?
If not, I’d recommend you begin to compute it. If you’re already keeping records, it’s easy enough to add to those records. Also, your win/loss percentage? If you know your average loss and your average win, as well as your historical probability of picking a winner on each trade, then you’ll know if that area needs work or not, which is an assessment you alone can make.
Who knows? You might find out that your performance is already in a good place in terms of risk reward. On the other hand, if there’s something that’s not quite working right, you should be able to see it in your historical data, and you can address it.
The world is a beautiful, magical, mysterious and scary place. The scary part is, we’re all going to die, and the moment of death uncertain. As it turns out, every single moment is uncertain, not one is guaranteed. We all have to deal with uncertainty one way or another — markets present that challenge, as does any other activity that requires a certain level of performance in order to achieve success. But one way or another, we all must deal with uncertainty.
Thanks for your encouragement on my trading. Doing the opposite of what I did as a newbie 5 years ago: Using micro trades to develop the right habits while putting very small amounts of capital at risk, with plans to increase that only as my actual performance allows. As suggested in “Trading in the Zone,” it will take as long as it takes (but hopefully toute de suite! 😉 )
GARY — Are we still looking forward to a SM correction in late October before the Santa Clause rally? And if so, in what fashion..? A left translated cycle of some sort? Your best guess 🙂
The ICL occurred on Aug. 21. We are now starting the vertical phase of the bubble. The next step is for the NDX to break through the 6000 resistance level.
I know but a correction or a re-test of the breakout zone later in the fall is certainly not out of the question — correct?
I’ve gone over in detail in the nightly reports how I anticipate the vertical phase to play out. Cycles may, and probably will cease to work during a vertical phase just like they didn’t work very well during the gold baby bull.
Ok Thx 🙂 You still travelling the States or back home in Vegas?
Back in Vegas.
https://seekingalpha.com/article/4110739-next-fed-governor-will-superheat-economy?ifp=0&utoken=f981bea12e9e298f28f73ca2cd5561eaf40eb638&v=1506685500
Been a SM bull gold bear for sometime. May have to change my tune come December. YEllen’s appointment ends in Febuary and very plausible we get QE5 rather then tightening and rates going up. See above plausible imo.
Zkot,
I used to keep a detailed record but as the number of trades increased I gave up.
I have like 25 trading books, some of them are inspirational.
But in this business, to improve one must look deep inside.
A trading log is essential, whether on paper or in your mind.
The secret to become a better trader is to jot down why one loses money and why one makes money.
That is step number one, at first it might be a very difficult item to sort out.
Step number two is to weed out the biggest losing weed. And then the next one as so forth.
That will take care of losses and minimize them.
Step three, is to number the ways one can make money, and start practicing one by one to broaden the trading horizon.
Simplicity is paramount. One must have the skill to control one self and modify one self, otherwise there is no improvement. Strangely, to do this which might appear formidable to some, all what is required are little steps, the big steps take care by themselves.
Zkot,
I would say that my risk/reward ratio might be 1-3-5 just inversely of what you would expect.
In part because I do not wait enough and leave at times a lot of money on the table.
Recall that at times I make money on falling knifes going long. No book, would dare to recommend such trading. Or some people would believe it.
If I am fresh in the morning and in the “zone” the likelihood that I will win a trade is very, very high.
But if I get stupid in hopium I can let myself lose a lot of money in a falling knife. This is my biggest weed.
Another aspect that I am working on is just buy some shares, it does not matter which way the marker goes. The point is that you get engaged by the game and are challenged to prevail.
Full moons, be sure to wear your tin foil hat.
How about JNUG 1500? 2000? Why not?
Oil is going to higs; really?
False hopes. We are now sub-hunting.
No, Oil is not caught between 40 and 60…..60 was up out there; and 60 is not part of the trading range since then.
Oil caught between $41-$42 to $55 in the current range. But it will soon top locally in 1-2 weeks; and way down it goes through the end of year and into January.
Oil is most likely going under $40 by January 2018.: a repeat of what happened in January 2016;
Before it ever goes to $60…
Pls respect everyone’s intelligence, and thwart emotional (marketing) urges to be over-the-top.
Folks, when people make emotional pie-in-the-sky calls like JNUG 500 and “NASDAQ 20,000 is no problem” and tell you invest in something that “is sure now in a bubble phase “, RUN!
How many times must I keep getting these calls right before you start paying attention?
BTW JNUG is going to take at least 3-45 years to reach those levels. We have to achieve the bubble phase in gold. I seriously doubt you have anywhere near the kind of patience needed to hold that long.